HP has been posting drop in revenues for the past 4
quarters primarily due to global slowdown. The technology major recorded
revenues of $31,189 million in July quarter of 2011; $31,632 million in April
quarter of 2011; and $32,302 million in January quarter of 2011. Its recent
acquisitions also did not assist the IT major to improve revenues.
In 2010 as well, its revenue was not encouraging for both
analysts and investors. During the October quarter of 2010, HP revenue was
$33,278 million; $30,729 million in July quarter of 2010; $30,849 million in
April quarter of 2010 and $31,177 million in January quarter of 2010.
Analysts are cagey about an immediate revival for HP as
Meg Whitman, the newly elected CEO, has been serving as a member of the Board
of Directors of HP since January 2011. Since January 2011, HP
revenues, under the ex-CEO Leo Apotheker, did not improve. Decline in
performance and lack of direction was the primary reasons for Leo’s
termination.
If the market recovery is not happening in the next 2-3
quarters after the US president’s new stimulus packages, HP’s revenues may
continue to be bleak.
Considering Whitman’s previous background, HP may take
more time to regain analysts’ confidence in the short term. Besides eBay, where
she managed the business for 10 years, she worked with a toy company, a floral
products company, an entertainment company, a footwear company and others.
Since she has the support of the board at HP, Whitman can do wonders for HP in
the long run, according to analysts.
From March 2011 to September 2011, Whitman served as a
part-time strategic advisor to Kleiner, Perkins, Caulfield & Byers, a
private equity firm. Previously, Whitman served as president and chief
executive officer of eBay, from 1998 to March 2008. Prior to joining eBay,
Whitman held executive-level positions at Hasbro, a toy company, FTD, a
floral products company, The Stride Rite, a footwear company, Walt Disney
Company, an entertainment company, and Bain & Company, a consulting
company. Whitman also serves as a director of Procter & Gamble
Company and Zipcar.
Even as HP endures another leadership change with the
appointment of industry veteran Meg Whitman as its new CEO, the company insists
that services, particularly its outsourcing and global delivery capabilities,
will play a critical part in HP’s future,” said Jens Butler and John
Madden, analysts at Ovum.
Industry is expecting a strong and better HP. HP has been
growing through several acquisitions. However, in the recent past, its hunger
for acquisitions has gone down. HP should go to market for more deals as many
companies will be available cheaper during the current stock market turbulence.
By Rashi Varshney and Baburajan K
editor@telecomlead.com
